The Confrontation

Upstairs, as his advisers clustered around the red sofas in his living room, President Reagan began Sunday's meeting on the plan to close down the federal government by questioning the wisdom of it.

He asked a question:

Would the new cuts that might be won by vetoing the continuing budget resolution be large enough to "justify" the disruption that surely would result from forcing the government to close for lack of funds?

That question would be asked many more times--most often by Reagan's Democratic critics--in the day ahead.

The answer, as the president's advisers explained it to him Sunday, was no, it probably was not worth the extra $2 billion in maximum new cuts to force the government to shut down. But it may cost many billions more than that in the 1983 and 1984 budget battles if the president does not demonstrate now that he intends to stand tough.

What Nov. 23, 1981--the day the government shut down--was really about was standing tough for 1983 and 1984. As presidential advisers tell it, the decision did not come quickly or easily for Reagan in that pivotal meeting that began shortly after 1 p.m. Sunday in his living room. It took a while before the president was persuaded.

Point by point, his advisers reviewed with Reagan the pros and cons they had just discussed downstairs in their legislative strategy session. The talking was done by the president's chief of staff, James A. Baker III, and by his chief of expertise, David A. Stockman. The born-again budget director's last lengthy talk with Reagan had been out back in the woodshed, but with this crisis he apparently is winning his way back into the trusted graces of the Reagan elite.

* The pros:

As the advisers explained it, at stake most of all was not just an extra $2 billion in cuts from the 1982 budget but prospects for forcing a tough line next year, in the certain conflict over the 1983 and 1984 budgets.

"It will set a very bad precedent for next year," one adviser argued, if the president was seen settling for less than one-quarter of the cuts he had asked for this year.

* The cons:

Disruption within the federal goverment would be considerable, and the shutdown itself would be expensive, but, if the president set out on this course, there could be no turning back. If he threatened a veto, he must be prepared to do so and force the shutdown.

And there was one question of considerable political sensitivity which, as one adviser phrased it, was: "To what extent will we upset our own Republican leadership on the Hill, the people who have been working so hard for us on a compromise resolution?"

Downstairs, in their legislative strategy session in Baker's office in the West Wing, Baker and Stockman had spoken in favor of a veto, according to a knowledgeable White House source. Counselor Edwin Meese III, as is his style, had talked of pros and cons but had not committed himself to a position.

Stockman had brought up one matter of major concern downstairs. There was no guarantee that this would be just a one-day wonder, a quick furor quickly resolved. It could last for days. The government could really be shut down.

Stockman had mentioned a possible way out--vetoing the continuing resolution but asking Congress to enact a simple 15-day extension of the existing funding resolution. But the advisers did not discuss this tactic in detail among themselves nor did they take a vote.

When they received word that Reagan was ready for them upstairs in the mansion, one of them asked: "What should we recommend to the president?"

Baker replied: "Everybody should just express how they feel." That is how they left it.

In the president's living room, that 15-day extension proposal proved pivotal. Baker and Stockman mentioned it, then Reagan seized on it as a way of having his veto and his government, too.

"It became easier to consider the veto knowing that there was an alternative, a simple 15-day extension of the present funding, that could also be available," a senior presidential adviser recalled. "As this was explained to the president, he became more receptive."

The advisers began to hone the idea into a full-fledged strategy. The coming Thanksgiving holiday would work to their advantage, they figured, because members of Congress would be anxious, most of all, to go home for the holidays. and would be favorably disposed to a simple, short-term extension. And the president would receive a clearly symbolic, comparatively painless one-day closing of the government that he can wear as a battle ribbon in future budget wars.

Just 25 minutes after they had started, the president reached for his telephone. "Get me Howard Baker," he said, and soon the Senate majority leader was on the line.

"Howard, I just can't take this," Reagan said, referring to the compromise continuing resolution which he contended was cutting 1982 spending by an additional $2 billion, instead of the $8 billion he had originally wanted or the $4 billion he had earlier agreed to accept. "We'll never get what we want if we settle on this amount."

He spoke next to his close friend, Sen. Paul Laxalt (R-Nev.), and House Minority Leader Robert H. Michel (R-Ill.). Finally, he interrupted a meeting with the king of Sweden to take a call from House Speaker Thomas P. (Tip) O'Neill Jr. (D-Mass.), who warned that Democrats might try to keep the existing resolution until February if Reagan carried out his veto threat.

Yesterday morning, Cabinet members gathered in the Cabinet Room before a television set to watch the president tell the nation that he was indeed using the first veto of his presidency. Then Reagan entered and told them why he had done it.

This was no ordinary Cabinet meeting. At the suggestion of deputy chief of staff Michael K. Deaver the night before, this had been publicly proclaimed an "emergency" Cabinet meeting. "That gave it a sense of urgency," one adviser explained, and the symbolism was apparent.

Stockman distributed a fact sheet and told all Cabinet members how they should close down their agencies. Reagan explained that truly "essential" functions could continue, to which Secretary of Education Terrel H. Bell replied:

"To be honest about it, sir, we could just fold up."

The essentials continued to function. In one West Wing office, aides studied tallies of Saturday's budget vote that Reagan had narrowly lost, identifying as likely converts to their cause the few Republicans who strayed and some southern conservative Democrats.

A press aide, meanwhile, led a television camera tour of vacant offices, so America could see on the evening news a government in inaction.

Midway through the tour, the House voted for the 15-day extension, handing O'Neill one more defeat, giving the president his symbolic victory and assuring that today would be business as usual.